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A test of the widespread-point-shaving theory

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  • Borghesi, Richard
  • Dare, William

Abstract

We test whether corruption is widespread in NCAA basketball by examining scoring patterns in games involving suspected point shavers. If conspiracy occurs frequently, then we should find that strong favorites score fewer points and/or allow more points than expected. However, findings reveal that strong favorites, previously believed to be the most likely candidates to engage in point shaving, may instead be the least likely. We propose that a shift in coaching strategy late in blowout games explains the anomalous bet outcome distribution patterns previously identified in the NCAA basketball betting market.

Suggested Citation

  • Borghesi, Richard & Dare, William, 2009. "A test of the widespread-point-shaving theory," Finance Research Letters, Elsevier, vol. 6(3), pages 115-121, September.
    • Handle: RePEc:eee:finlet:v:6:y:2009:i:3:p:115-121
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    References listed on IDEAS

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    1. Richard Borghesi, 2008. "Widespread Corruption in Sports Gambling: Fact Or Fiction," Southern Economic Journal, John Wiley & Sons, vol. 74(4), pages 1063-1069, April.
    2. Roger Vergin, 2001. "Overreaction in the NFL point spread market," Applied Financial Economics, Taylor & Francis Journals, vol. 11(5), pages 497-509.
    3. Gray, Philip K & Gray, Stephen F, 1997. "Testing Market Efficiency: Evidence from the NFL Sports Betting Market," Journal of Finance, American Finance Association, vol. 52(4), pages 1725-1737, September.
    4. Paul, Rodney J. & Weinbach, Andrew P. & Wilson, Mark, 2004. "Efficient markets, fair bets, and profitability in NBA totals 1995-96 to 2001-02," The Quarterly Review of Economics and Finance, Elsevier, vol. 44(4), pages 624-632, September.
    5. Justin Wolfers, 2006. "Point Shaving: Corruption in NCAA Basketball," American Economic Review, American Economic Association, vol. 96(2), pages 279-283, May.
    6. Golec, Joseph & Tamarkin, Maurry, 1991. "The degree of inefficiency in the football betting market : Statistical tests," Journal of Financial Economics, Elsevier, vol. 30(2), pages 311-323, December.
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    Cited by:

    1. Robert Arscott, 2023. "Market Efficiency and Censoring Bias in College Football Gambling," Journal of Sports Economics, , vol. 24(5), pages 664-689, June.
    2. William H. Dare & Steven A. Dennis, 2011. "A Test for Bias of Inherent Characteristics in Betting Markets," Journal of Sports Economics, , vol. 12(6), pages 660-665, December.
    3. Berkowitz, Jason P. & Depken, Craig A. & Gandar, John M., 2015. "Information and accuracy in pricing: Evidence from the NCAA men׳s basketball betting market," Journal of Financial Markets, Elsevier, vol. 25(C), pages 16-32.
    4. Borghesi, Richard & Paul, Rodney & Weinbach, Andrew, 2024. "Point shaving? A novel experiment and new insights," Journal of Behavioral and Experimental Finance, Elsevier, vol. 42(C).
    5. Sanders, Shane, 2022. "Point shaving in NCAA Men’s Basketball: Behavioral finance, scale, and deterrence," Journal of Behavioral and Experimental Finance, Elsevier, vol. 34(C).
    6. Berkowitz, Jason P. & Depken II, Craig A. & Gandar, John M., 2018. "Market evidence against widespread point shaving in college basketball," Journal of Economic Behavior & Organization, Elsevier, vol. 153(C), pages 283-292.

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